Tuesday, July 20, 2004

New vehicle sales slump

Consumer demand for new automobiles cooled slightly in May as sales fell for the first time this year, mostly because of a big drop in demand for trucks.

In total, car dealers sold 133,294 vehicles, down 3.2% from April. Trucks accounted for more than 80% of the overall decline of 4,361 vehicles.

The downturn occurred despite stronger economic indicators, including growth in the number of full-time jobs and continuing incentives offered by car manufacturers.

Consumers bought 70,383 new passenger cars, a 1.0% decline, and 62,911 new trucks, down 5.5%.

Preliminary data from the automobile industry indicate the slump has continued into June. Sales are estimated to have declined about 2%, primarily because of passenger cars.

Big gain in fuel prices

The decline in new truck sales coincided with a 13.6% gain in fuel prices, the steepest average monthly hike in more than 20 years. The truck category includes minivans, sport-utility vehicles, light and heavy trucks, vans and buses.

The decrease in new passenger cars occurred primarily because of weak sales among cars manufactured overseas, which fell at more than three times the pace of those built in North America.

Sales declined in every province except Newfoundland and Labrador, where they rose 5.2%. Substantial declines in Ontario, Quebec and Manitoba followed four straight months of uninterrupted gains.

For more information, contact Clérance Kimanyi (613-951-6363), Distributive Trades Division.

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© 2004, Statistics Canada.